Telstar Communications is going to purchase an asset for $380,000 that will produce $180,000 per year for the next four years in earnings before depreciation and taxes. The asset will be depreciated using the three-year MACRS depreciation schedule in Table 12-12. (This represents four years of depreciation based on the half-year convention.) The firm is in a 35 percent tax bracket. Fill in the schedule below for the next four years.

Earnings before depreciation and taxes               _____

Depreciation                                                              _____

Earnings before taxes                                              _____

Taxes                                                                           _____

Earnings after taxes                                                  _____

+ Depreciation                                                            _____

Cash flow                                                                     _____